Pakistan on Monday met US demands for an inquiry into how Osama bin Laden lived for years under the noses of its military but refused to be blamed alone for Al-Qaeda or its mastermind.

Pakistan on Monday met US demands for an inquiry into how Osama bin Laden lived for years under the noses of its military but refused to be blamed alone for Al-Qaeda or its mastermind.

In a 30-minute address to parliament, Prime Minister Yousuf Raza Gilani took veiled swipes at the United States and exonerated Pakistan's military of complicity or incompetence over the world's most-wanted terrorist.

Alluding to US funding in conjunction with Pakistan's role in the 1990s war against Soviet troops in Afghanistan, which ultimately gave birth to the Taliban and Al-Qaeda, Gilani said it was unfair for Pakistan to take all the blame.

"Collectively, we must acknowledge facts and see our faces in the mirror of history. Pakistan alone cannot be held to account for flawed policies and blunders of others. Pakistan is not the birth place of Al-Qaeda," he said.

"We did not invite Osama bin Laden to Pakistan or even to Afghanistan."

Pakistanis have expressed horror at the perceived impunity of the American raid that killed bin Laden, furiously asking whether their military was too incompetent to know he was living close to a major Pakistani military academy, or, even worse, conspired to protect him.

The debacle has been one of the biggest embarrassments ever to hit Pakistan's powerful military establishment and the civilian leadership has been left reeling, forced to explain itself in parliament.

But Gilani denounced allegations of complicity or incompetence as "absurd", expressed "full confidence" in the military and its Inter-Services Intelligence (ISI) agency, which he called a "national asset".

Pakistan long points out that it has lost more than 5,000 soldiers in fighting Islamist militants since 2002, more than the Americans in Afghanistan, and that its ISI agents were involved in dozens of Al-Qaeda arrests.

Gilani said Pakistan was "determined to get to the bottom of how, when and why" bin Laden had been hiding out in Abbottabad, close to Islamabad, and said an investigation had been ordered, later naming its head as Lieutenant General Javed Iqbal.

The fact that bin Laden was holed up for up to five years in the garrison city less than a mile from Pakistan's top military academy and only two hours' drive from Islamabad has deeply strained ties with the United States.

Gilani defended the relationship with Washington as a strategic partnership in both countries' interests, but there is widespread anti-American feeling among the country's largely Muslim population of 170 million.

"We will not allow our detractors to succeed in offloading their own shortcomings and errors of omission and commission in a blame game that stigmatises Pakistan," said Gilani.

The White House says President Barack Obama reserves the right to take action again in Pakistan after the May 2 hit.

Gilani insisted Pakistan also reserves the right to "retaliate with full force," although he stopped short of spelling what, if anything, Pakistan would do should the Americans stage another unilateral high-profile anti-terror raid.

Politicians earlier called for guarantees from the government that the country's sovereignty will not be breached again.

A week after an elite team of Navy SEALs flew in, seemingly undetected, killed the Al-Qaeda leader and flew off with his body, senior US officials said they had no proof Islamabad knew about his hideout.

Obama has pressed Pakistan to investigate how bin Laden lived for years under the nose of its military, saying he must have been supported by locals or even intelligence agents.

Outraged US lawmakers have voiced suspicion that elements of Pakistan's military intelligence services must have known his whereabouts, and are demanding that billions of dollars in American aid be suspended.

On Monday, hundreds of Taliban rallied in the town of Wana in the tribal belt, which Washington has called an Al-Qaeda headquarters, vowing to avenge the Al-Qaeda chief's death and denouncing Pakistan and the United States.

Although there have been isolated protests, there has been no major public outpouring of fury in Pakistan, where more people have died in bomb attacks than on September 11, 2001 and ordinary people struggle with inflation and power cuts.